A forum of ideas

As one of the world’s fastest growing economies China is also a rising star on the global political and cultural stage. ‘China’ seems to be everywhere and you cannot get around it, whatever your field of interest. China puzzles and China inspires. There are still more features of China that beg for research than there are familiar aspects. Not all ideas for research can be transformed into projects immediately, but we also would like to retain those ideas and share them with others.

This Forum has been set up as a platform on which VU researchers can share those ideas. Some may inspire others to react and to add their own opinions. Hopefully, some of these will in time lead to the formation of research teams.

VU researchers and our international associates are therefore cordially invited to send their ideas, preferably in the form short, 2 – 5 paragraph, stories to p.j.peverelli@vu.nl. After review, in which the contents will be checked against the leading principles of the VU China Research Centre, these stories will be added to this Forum, and we will attract attention to each new idea via Twitter and other media.

The Chinese firm in context – a research proposal

China is hot in academia as well as in society as a whole. Researchers from a broad range of specialisations have produced a massive body of publications about Chinese economy, politics and society during the past few decades. In the commercial world, by now, there is no multinational that has not at least attempted to set foot on Chinese soil.

It is therefore all the more surprising that China remains such a nut hard to crack for Western academics, business leaders and politicians. It seems as if the same mistakes are made again and again without many signs of learning.

The top recurrent problem is usually referred to with a Chinese expression: guanxi. This problem is apparently so tough, that even Chinese researchers have started using the term in their publications. Following the many Western publications, an avalanche of Chinese literature has appeared in recent years trying to decode the term and what it stands for, for a Chinese audience.

It is not impossible that Chinese researchers have been so influenced by foreign China watchers trying to interpret this magic term that they themselves have become locked up in that perception, and fail to note the obvious: that guanxi simply means ‘relationship’.

Relations and social networks are important in any social activity in any culture. It is a basic aspect of human behaviour. The ‘special’ role of social relations in China as perceived in Western research is a cultural difference. Such differences should be studied without a priori coining a special term for it, to avoid that this term will start living a life of its own and affect later research.

We should make a fresh start with studying the way Chinese initiate, develop and use social relationships using social constructionist organization theory. This will facilitate comparing similar processes in different countries and regions.

Another issue heavily researched and still poorly understood is the role of the firm in Chinese society. I believe that the lack of progress in this matter can also be attributed to a bias on the part of most researchers. This bias is rooted in Western economic theory, in which the firm is perceived as an economic actor separate from the people in the firm.

Take, e.g., firm ownership as an example. Western economics teaches us that the ownership of firms must be clear in order for the economy to grow beyond a certain level. The rapid and continuous growth of Chinese economy, and many other emerging economies, seems to deny this doctrine. We therefore need to go back to basics on this issue, with models that are better suited for this research topic. As economic activity is basically human behaviour, social constructionist organization theory will fit the bill better here than classic economics.

Using this model we can identify the social relationships of people within a certain firm to social groups outside that firm. An external social group can influence what happens within that firm through its member that is also an employee of the firm. An inventory of all relevant external inclusions of all employees of a firm (without initially concentrating too much on ‘decision makers’) can help explaining various aspects of the functioning of that firm in all areas of society, like: the general population, government organizations, competitors, suppliers, NGOs, etc. (Peverelli 2009 and 2011).

My central point in this proposal is that Chinese society, as a developmental state, consists of a network of smaller and larger groups, ranging from very formal (institutions) to very informal, many of which are indirectly controlled by the government. This control is not realized directly and overtly, but indirectly and covertly. People with positions (inclusions) in government agencies are also included in organizations like associations, commissions, and clubs. They form conduits through which ideas can flow from one organization to another and are the channels through which information about all societal activities reaches the government.

The other way round, the government interferes with those societal activities through the same people. This can take place through formal directives, but more frequently through informal briefings, or even covertly through friendly talks in a congenial environment.

I would like to propose research project starting with extensive field work + study of documents to make an inventory of the multiple inclusions of people in a selected number of organizations. That database can then be analysed by investigating how those inclusions have affected the ways those people acted within their organization and the consequences of those actions to the operation of the organization.

In case you would like to join, or react to this proposal otherwise, please contact by email.

Corruption or Collaboration: The Implications of Cultural Practices for Global Business and Management

For some people, it is corruption. For others, it is not. The proposed track is intended to solve this dilemma by exploring the West’s readiness to learn from the social and reciprocal values of different cultures. With increasing levels of globalization, cross-cultural collaboration and communication becomes an inevitable consequence of this process. Understanding the underlying core values of different cultures enables effective social networking, which, in turn, contributes to smooth collaboration processes and potentially successful collaboration outcomes. This track aims to explore and compare the core values of different cultures in social networking; for example, the role of Chinese "Guanxi" (关系) in interpersonal relations and the role of "Wasta" in social networking and cooperation in the Arab world. This track is aimed at exploring how the core values of such cultural practices affect our cross-cultural social networking and subsequently have long term consequences for the way we manage and do business.

Increasingly, the business practices across the world reflect a blend of Western and Eastern values. Chinese companies, for example, operating in Europe have vast investments. Volvo (the Swedish company) is now owned by Chinese investors. China also has a large stake in Peugeot Citroën and the Piraeus Port in Greece. Likewise, cooperation between Europe and the Arab world is also increasing. Qatar, for example, has large investments in London. It acquired a large stake of the Sainbury’s supermarket, bought Harrods and owns 8% of the London Stock Exchange, and nearly 7% of Barclays.

The lack of awareness and mutual understanding for diverse cultures and management styles is one of the biggest obstacles towards successful business cooperation between East and West. Social networking practices such as Guanxi and Wasta might affect business relations and cooperation with Western multinational companies. For some people, such practices amount to corruption. For others, they are accepted as part of the social fabric of some societies. The proposed track will highlight these issues and explore the West’s readiness to learn from the social and reciprocal values of different cultures. Guanxi and Wasta are provided here as an example but there are many other similar practices in the world that not many people know or indeed heard of. The track will be an opportune venue for scholars and students of business and management and the global business community to learn about and explore this important social and cultural phenomenon.

Amsterdam Research Project (ARP)

The ARP is an international research project of the School of Business and Economics at the VU University of Amsterdam in collaboration with Aureus, the student association of the School.
We are a group of skilled, ambitious business students in the final years of our study, who will prepare, construct and conduct academic research in emerging markets. This is a part of our Master's of Science curriculum for which we obtain credits. Previous research has been done in, i.a., Vietnam, Indonesia, Malaysia, South-Korea, Argentina, Brasil, India and South Africa.

The ARP of 2016 will take place in China.

The current Amsterdam Research Project consists of twenty-one selected third year Bachelor and Master students. During the course of one year the students are turned into consultants with in-depth knowledge of China. Senior academic staff and professionals from the private sector provide extensive training and guidance. With educational backgrounds from marketing, finance, strategy, and consulting, the Amsterdam Research Project represents a wide variety of specializations, which results in a multidisciplinary look on matters.

The course coordinator is Dr. Peter Peverelli, the Academic Director China at the VU China Research Centre. The combination of this highly motivated group of students and Dr. Peverelli's 4 decades of China experience are a guarantee for state of the art market research.

‘’Good co(o)rporation and Cultural Ethics’’ The Future of International Corporation Practices in Chinese and European Culture

A round table discussion will be held in The Hague in the afternoon of May 24

Based on the extended information given in the lectures the questions during the roundtable will be opened by statements from the participants on the following propositions:

What does China have to offer with concern to the regulation of the practices of multinational corporations and in which way could an international court of law? Does China’s system of socialist rule of law with Chinese characteristics suitable for international regulation of corporate practices? How can equal global representation in an international court of law dealing with the practices of multinational corporations be accomplished? Should this be part of the United Nations, or the WTO or should it evolve independently? How can an international court of law monitor the asocial financial and non-compliant practices and develop regulatory instruments and/or suitable punishments for multinational corporations? How can research independence from lobbying in a prospective international court dealing with multinational corporate practices be ensured?